B2016/1334, Transcript of Proceedings [2017] FWCTrans 270 (26 June 2017)

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PN1

THE DEPUTY PRESIDENT: Thank you. I will note the appearances are ongoing and I think last time we discussed in terms of Mr Harrington first and then Mr Bakri in reply.

PN2

MR HARRINGTON: Yes.

PN3

THE DEPUTY PRESIDENT: Yes, all right. Thank you.

PN4

MR HARRINGTON: Thank you, Deputy President. I don't intend to take a lot of time because the respondent had the benefit of the applicant's outline of closing submissions when it drafted what I considered to be a fairly detailed submission running for ten pages.

PN5

THE DEPUTY PRESIDENT: Yes.

PN6

MR HARRINGTON: So in one respect it could be said to me: "Well, you have your go, you responded to everything that you needed to respond to."

PN7

THE DEPUTY PRESIDENT: Yes.

PN8

MR HARRINGTON: The approach I will take really is an executive overview of the respondent's outline and closing submissions which I will not read to you, of course.

PN9

THE DEPUTY PRESIDENT: Yes.

PN10

MR HARRINGTON: I will just take you to certain points. But that, hopefully, will also give you the opportunity at any relevant time to pepper me with any questions that you might have about any submission I have made and that will be it from me.

PN11

THE DEPUTY PRESIDENT: All right, thank you.

PN12

MR HARRINGTON: Turning to the respondent's outline and closing submissions, you will see that we refer to and rely upon the earlier set of submissions and if I may refer you in the general sense to the respondent's outline of submissions which was filed, of course, back on 27 April and at page 4, paragraph 12, we have sought to articulate quite a number of fairly broad proposition which should inform the statutory task that you are to carry out in this application. In reading my learned friend's submissions, I didn't pick up that he was really taking any particular issue with that articulation of the principle at 12(a) to 12(o), although there may be some points of emphasis that is the difference between us.

PN13

My learned friend in his applicant's outline of closing submission did not appear to prosecute any further what I will call the conflation point. Again, Deputy President, we put in a reply submission, you might recall, responding very specifically to that submission. We have previously provided you with a folder. It might be easiest if I refer to the tab numbers in that folder. If I recall correctly, that is right at the end of that folder, tab 13.

PN14

THE DEPUTY PRESIDENT: All right.

PN15

MR HARRINGTON: Last time we were here, we handed up a folder.

PN16

THE DEPUTY PRESIDENT: Yes. Mr Harrington, I am just going to have to check where that folder is.

PN17

MR HARRINGTON: Hopefully it is not propping up a pot plant somewhere.

PN18

THE DEPUTY PRESIDENT: No, I have got plenty to do that. I will just - - -

PN19

MR HARRINGTON: That is okay. You would have. You did. I am sure you did receive it because I referred to it last time we were here.

PN20

THE DEPUTY PRESIDENT: Yes.

PN21

MR HARRINGTON: I don't need to take you in any detail to that particular document. It is at tab 13 of the folder we handed up.

PN22

THE DEPUTY PRESIDENT: Yes.

PN23

MR HARRINGTON: It is the reply submission that dealt with what we called the conflation submission because my learned friend in his opening submissions said and I will record it and I will read from this document: "The applicant asserts that the respondent" - I am reading from my reply submission.

PN24

THE DEPUTY PRESIDENT: I have got the - this is the 19 May submission, is it?

PN25

MR HARRINGTON: Yes, that is right, yes.

PN26

THE DEPUTY PRESIDENT: Yes, I have got that with me.

PN27

MR HARRINGTON: I am touching upon that to simply say that I did not read my learned friend prosecuting that submission any further in his closing submissions that there have been a so called impermissible conflation. I don't take that point any further.

PN28

THE DEPUTY PRESIDENT: All right.

PN29

MR HARRINGTON: We have been direct and blunt at page 2 of the respondent's outline of closing submission in addressing what, in my submission, is the poor quality of the ASU evidentiary case.

PN30

THE DEPUTY PRESIDENT: Is this in addition to what was the outcome last time of the various evidentiary objections that you raised or is this a reassertion of it.

PN31

MR HARRINGTON: It is a summary of that for this reason. I recall that, Deputy President, you said in dealing with the hearsay objection, and I put that very generally, you will obviously be hearing from the parties in closing submissions about that matter. There was a second part to the objections taken to the evidence on the question of relevance and admissibility in a different context to hearsay. We resolved that before you. There was some contest.

PN32

THE DEPUTY PRESIDENT: That was all the matters that were struck out of the statement.

PN33

MR HARRINGTON: Correct.

PN34

THE DEPUTY PRESIDENT: This is the remainder and what do you say about the remainder.

PN35

MR HARRINGTON: Yes.

PN36

THE DEPUTY PRESIDENT: All right.

PN37

MR HARRINGTON: And I have said a lot about it because I handed you a document on the day, but I recalled when I sat down to write these submissions that you said you expected to hear from the parties, effectively, about the weight question, what weight can be attributed to the hearsay that - and I don't wish to verbal you - you appeared to allow the hearsay in. You didn't exclude it and I accept that, but you wanted to hear from us on the weight that could be attributed to it. And so what I have done at page 2 of the submissions commencing at paragraph 9 is to address the nature of that hearsay which was already the subject of objection and saying that it is effectively, paragraph 10, inherently unreliable as a source of evidence if it is not otherwise corroborated.

PN38

There were ways that it could be corroborated by putting propositions to my witness, Mr Chrara, and that was done in cross-examination. But where there is no other form of corroboration, it is inherently unreliable and very weak evidence, indeed, primarily because it is unclear on the evidence of Mr Lewis whether it was second-hand or third-hand or even more remote than that. So you just don't know as the decision maker where it is sourced from.

PN39

THE DEPUTY PRESIDENT: But we have had, I think, some discussion about, well, no one wanted to come forward or put their name to it because of a concern about identifying themselves in the context of any bargaining that subsequently occurs. So, what do you say to that?

PN40

MR HARRINGTON: I have two responses to that. The context in which that was put to you was from the Bar table.

PN41

THE DEPUTY PRESIDENT: Yes.

PN42

MR HARRINGTON: A serious matter asserted from the Bar table that, in my submission, makes a serious allegation of threatened unlawfulness in the sense of general protection style breaches which is, if you exercise a workplace right, something adverse will happen to you.

PN43

THE DEPUTY PRESIDENT: Yes.

PN44

MR HARRINGTON: That is made from the Bar table to start with. It is a serious allegation of potential unlawful behaviour so the Briginshaw standard would automatically come into place even in the tribunal. But that is the first part of the submission. The second part of the submission is that notwithstanding that it was asserted from the Bar table after a brief adjournment and a discussion no evidence was led from the witness, Mr Lewis, directly about what I will call those Briginshaw style serious allegations. In that sense, the allegation of the fear or threat of retaliatory conduct, the fear or threat of general protection style breaches, is no more than a puff of smoke from the Bar table if it is not otherwise advanced through a witness or in the evidence.

PN45

THE DEPUTY PRESIDENT: All right.

PN46

MR HARRINGTON: You will see the submission is made at paragraph 12 that Mr Chrara's evidence ought be accepted where there is any conflict between Mr Lewis and Mr Chrara. And it is not, I must be clear about this, it is not a credit question. I don't accused Mr Lewis of not telling the truth or not being honest in the witness box. It is just the stronger cogency of the evidence was adduced via Mr Chrara in all the circumstances.

PN47

THE DEPUTY PRESIDENT: Your proposition is that Mr Chrara is in a better position to know the way in which the law practice operates, is it?

PN48

MR HARRINGTON: Absolutely, yes, and you have done well to very astutely articulate it in those few words. That is the way, that is the point, and it is brought into sharp focus at paragraph 17 on page 4 of the respondent closing submission because you did not exclude from Mr Lewis' statement, exhibit A1, at paragraph 7, this proposition, "Shine operations are independently administered at the state and branch level", which is both a conclusion and an opinion. My recollection is you did not exclude that. It was objected to.

PN49

The submission that I have made back on page 2 in respect of Mr Chrara's evidence is that where there is a conflict because Mr Lewis has given an opinion or drawn a conclusion like that and Mr Chrara says the opposite of that which he does, as a matter of evidence, you should prefer, subject to anything that came out of cross-examination, you should prefer the evidence of Mr Chrara.

PN50

At page 3 under the heading, "Analysis of the evidence", I have set out at paragraph 16(a) to (u) what we would consider to be the highlights package of Mr Lewis' evidence. That is just to assist you in your decision-making task. It really goes to what Mr Lewis did not know or what he could not be certain of and his failure to have any fundamental engagement with Queensland, Western Australia or New South Wales which goes unexplained in many respects. It is a fact that there was no real engagement with employees in those places, but there is no explanation as to why that was so.

PN51

What you do know on the un-contested evidence is that the respondent, Shine, operates a national law practice. It derives 68 per cent of its revenue from personal injuries litigation, amongst all those offices. It employs lawyers and legal support staff in all those offices. There are some differences in how the business is carried out because of statutory regimes and we accept that, of course, that statutory regimes in the personal injuries sphere can ordain different practices and the like and Mr Chrara gave evidence that quite often the differences can be in the pre-trial steps or the pre-issuing steps as opposed to strict compliance with legislative guidelines and deadlines and the like. But there is no doubt there is differences around the country in compensable injury litigation which, of course, includes worker's compensation and transport accident litigation.

PN52

I dealt with paragraph 17 on page 4 where I have attacked the credibility of the broad assertion from Mr Lewis that Shine operations are independently administered at the state and branch level. It is a lay opinion, it is tendentious and it is not supported by any objective evidence. I have given you a summary of Mr Chrara's evidence on page 5 and again I don't need to read that out. But at paragraph 19, an expression or phrase that you will see in a few places is: "The nationally integrated legal practice." Again, I don't read my learned friend's submissions to impugn that concept or idea that it is national, that it is integrated. But my learned friend tries to advance a case as to elements of the business that are distinct, whether they are operational, organisational or geographic and I will come to that.

PN53

I should have made a small point about this about the Jones v Dunkel inference and this is back at footnote 1 on page 2 that in terms of Mr Lewis' evidence and I should say the applicant generally, we do invite the Commission to draw the Jones v Dunkel inference and it is for this reason, Deputy President. If you look at the summary on page 3, paragraph 16 of Mr Lewis' evidence, you will see at (c) and (d), and I am quoting from (c) first:

PN54

Mr Lewis had interacted with Shine employees at various offices on up to 42 occasions over an eight to nine-month period. He had regular contact with approximately 40 employees. Mr Lewis was in regular email or other contact with Shine employees updating them as to developments.

PN55

Those critical pieces of evidence extracted under cross-examination provide a sound basis for a finding that Mr Lewis was hardwired into his members in Victoria in the respondent workplace, yet there was no compelling or strong basis for asserting that employees themselves, members, employees of Shine could not be called to give evidence about what they did and how they do it and, particularly, in the case of Mr Lewis' evidence where he asserts in a partisan manner that the state operations are run independently. The best evidence would have come directly from employees, but there was simply no clear basis or explanation for why they weren't called which opens up the possibility of that inference and it is a matter for you, but we would press that that inference be drawn.

PN56

Can I go back to where I was and under the heading on page 6 the - I should just finish with Mr Chrara's evidence at paragraph 23 and 24. He gave evidence about the national training courses. He gave evidence - and this is paragraph 24 - that there is a strong evidentiary basis for a finding of fact by the Commission that Shine operates a nationally integrated legal practice. The Shine practice necessarily comprises distinct geographically differentiated office locations. That it is managed out of head office in Brisbane. That it generates approximately 68 per cent of its revenue from personal injury claims litigation. That it operates a shared services model and the Victorian operations receive resource support and service support from the Brisbane head office.

PN57

On the question of the relevant legal principles, I don't think we handed a copy of the authorities folder last time.

PN58

THE DEPUTY PRESIDENT: No.

PN59

MR HARRINGTON: Did you receive that from - - -

PN60

THE DEPUTY PRESIDENT: I don't - - -

PN61

MR HARRINGTON: Excuse me for a moment. Yes, sorry. I have got a copy of each authority which we rely upon.

PN62

THE DEPUTY PRESIDENT: Yes.

PN63

MR HARRINGTON: Will it assist you to receive those?

PN64

THE DEPUTY PRESIDENT: Yes.

PN65

MR HARRINGTON: Yes, fine. Sorry for the slight delay.

PN66

THE DEPUTY PRESIDENT: That's all right.

PN67

MR HARRINGTON: But I will hand up that bundle if that assists you in that way.

PN68

THE DEPUTY PRESIDENT: Yes. Thank you.

PN69

MR HARRINGTON: I apologise that they are in that bundle form, but most of them are referred to explicitly in the written document and the relevant quote has been extracted.

PN70

THE DEPUTY PRESIDENT: Yes.

PN71

MR HARRINGTON: Can I deal first with I think a point of great contention between us which is I think we would both accept that it is a relevant consideration that a majority of the employees who will be covered by the agreement want to bargain and you will have to have regard to that. That is section 37(2)(a), what might be called a mandatory consideration. Our submission is that that is but one consideration in the statutory task that you will carry out in this application, but it carries no more weight than any other relevant consideration.

PN72

The Full Bench in BP Kwinana said something really a little bit different to that at paragraph 31. I am certain that the Kwinana decision has been handed to you if you have it up there.

PN73

THE DEPUTY PRESIDENT: Yes, yes.

PN74

MR HARRINGTON: That is Australian Workers' Union v BP Refinery (Kwinana) Pty Ltd [2014] FWCFB 1476. The relevant passage is at - if you start at 29, you will see there is a reference to the ILO Convention and the like.

PN75

THE DEPUTY PRESIDENT: Yes.

PN76

MR HARRINGTON: I will ask you to keep that in mind because I am going to take you to or quote to you from a Federal Court decision which I only found in the half an hour before I came here but I will make available to you about the construction task on this question. So at 29, the Full Bench makes reference to the ILO Convention and, of course, the importance of collective bargaining. Then at 30, there is a reference to what was said in United Firefighters and if you read down just slightly you will see, this is about six or eight lines down:

PN77

The legislative scheme supports collective bargaining principles and the Fair Work Act encourages freedom of association and collective bargaining. It may be implied from the legislative scheme that the collective choice of employees is significant. It must be said, however, that while weight should be given to the views of the employees potentially affected, it may be that a proper consideration of the matters specified in sections 238(4) and (4A) in a particular case may make it appropriate to make a scope order contrary to the views of the employees potentially affected.

PN78

Of course, United Firefighters dealt with a scope application under 238. At 31, the Full Bench, this is 31 in BP Refinery Kwinana, say this:

PN79

It is in this way that the views of the employees become significant and prima facie carry greater weight than the subjective views of the employer unless, as in United Firefighters, there are particular circumstances in a given case that make a contrary conclusion appropriate upon a proper application of section 238.

PN80

That is wrong. So that we are clear, that observation or finding in the construction task by that Full Bench is wrong because, and we have made submissions about this at paragraph 29, there is no basis or support in the text and to be fair to the Full Bench, the Full Bench does not go to the text to divine that meaning. It appears that the Full Bench, applying the United Firefighters approach, adopts this concept: "It may be implied from the legislative scheme that the collective choice of employees is significant." That is the critical line from United Firefighters that leads to that proposition in 31.

PN81

A case that I will make available to the Commission that you will recall in my learned friend's submissions, the applicant's outline of closing submissions, my learned friend referred to the first instance decision by Commissioner Rowe in the Cotton On.

PN82

THE DEPUTY PRESIDENT: Yes.

PN83

MR HARRINGTON: I am sure he will hand up a copy of that. In that decision, there is reference to a decision of Justice Siopis in the Federal Court, John Holland Pty Ltd v Construction, Forestry, Mining and Energy Union [2014] FCA 286, 27 March 2014. That was a decision where a writ in the nature of certiorari was issued to quash a Full Bench decision in approving an agreement with only three employees. You might be aware of that decision itself. What Justice Siopis did along the way is he looked - and Commissioner Roe was also very much alive to this - he looked at the 186(3) and, Deputy President, if you go to that provision in the Act, you will notice that 186(3) refers to: "The FWC must be satisfied that the group of employees covered by the agreement was fairly chosen."

PN84

THE DEPUTY PRESIDENT: Yes.

PN85

MR HARRINGTON: Then you have got 3A which replicates 237 at 3 and 3A. So, similar, I think, identical language, there is a consideration in the approval process. What Justice Siopis said, and I am here addressing you, Deputy President, on this construction question about greater weight to employees' views. Mr Reitano for the CFMEU in that case made a submission that section 578(a) of this legislation, again if you go to that provision:

PN86

Matters the FWC must take into account in performing functions. In performing functions or exercising powers, in relation to a matter, under a part of this Act, the FWC must take into account: (a) the objects of this Act, and any objects of the part of this Act.

PN87

THE DEPUTY PRESIDENT: Yes.

PN88

MR HARRINGTON: Mr Reitano for the CFMEU in the John Holland case relied upon that provision and advanced the proposition that one regard to the objects and the ILO Convention and the like to give meaning to the relevant words of the legislation. Call it the statutory context, if you like. Justice Siopis at 38 said this:

PN89

Section 578(a) relevantly provides that Fair Work Australia must, in exercising its powers, take into account any objects of the Fair Work Act and the objects of any part of the Act. However, I am of the view that the general words in section 578(a) do not permit Fair Work Australia to imbue the words of the statute with concepts which are not to be found in those words when properly construed. In my view, the proper construction of section 186(3) is informed by section 186(3A). That section prescribes the nature of the considerations to which Fair Work Australia is to have regard in exercising its power under section 186(3). Therefore, in my view, Fair Work Australia is not at liberty to exercise its section 186(3) powers on some other basis in reliance upon the general provisions in section 578(a) of the Fair Work Act. In other words, the general words in section 578(a) must yield to the specificity embodied in section 186(3A) in relation to the proper construction of the words "was fairly chosen" in section 186(3).

PN90

THE DEPUTY PRESIDENT: So in the John Holland context, did that then mean that his Honour took the view that the ILO principles were not to be read into the interpretation?

PN91

MR HARRINGTON: Yes. Yes, it is a good question because at 37 - I was reading 38 - at 37, this was stated:

PN92

Further, in my view, the words "was fairly chosen" in section 186(3) are not to be construed as "was chosen in a manner which would not undermine collective bargaining". Notwithstanding the patient argument of Mr Reitano at the hearing, I am of the view that section 578(a) of the Fair Work Act does not support giving that construction to the words of section 186(3).

PN93

THE DEPUTY PRESIDENT: Yes.

PN94

MR HARRINGTON: I apologise that I am reading from my phone in making those submissions. I will come back to this decision, as I am sure my learned friend might, because Justice Siopis made another observation about section 186(3A) identical to 237(3A) which I will come to in a minute. But it was only in reading that recently that I have realised that Justice Siopis makes a powerful case not directly on point in the sense of dealing with the submission I have made today, but makes a powerful case in respect of how one construes the words of the legislation and one does not imbue concepts or imply into the construction task necessarily convention concepts and the like.

PN95

THE DEPUTY PRESIDENT: Yes.

PN96

MR HARRINGTON: Because what the Full Bench did in United Firefighters as applied by BP Refinery Kwinana was to imply into the legislative scheme that one factor, the collective choice of employees, is significant; not just relevant, but significant. But when one goes to the words of the section, and I am talking about 237(2) particularly here, Parliament did not accord greater or significant or the most profound weight to a particular consideration. It just did not do that in that provision and that means that the choice of employees insofar as that is dealt with is a relevant consideration particularly if one goes to 237(2)(a): "The FWC must be satisfied that a majority of the employees who are employed by the employer or employers at a time determined by the FWC and who will be covered by the agreement want to bargain."

PN97

Definitely a relevant consideration, but not be accorded a more significant or greater weight and that is made pointedly because we are a part on that and that is now squarely in issue in this application because my learned friend in his submissions at 55, page 10:

PN98

In the present matter, the evidence establishes that from the roll of votes of 92 employees, 59 employees voted in favour and two against. It is submitted that this is a resounding indication from the relevant group of employees that they wish to bargain for an enterprise agreement that covers them and should be given significant weight.

PN99

That is the language that was used by Kwinana, in my respectful submission, and it would be erroneous, in my submission, as a matter of construction to construe 237(2) in that manner because there is no basis in the statutory text for approaching your task in that manner.

PN100

The next submission that is made at page 7 is that there is no geographical distinctness. My learned friend seems to suggest that it is faintly preposterous that we maintain that position. He corrects me. He says it is not faintly and I thank him for that. He is going harder. He is saying it is preposterous. That may well be his submission before he read our submissions, but if he has read and understood our submissions he would see that it is perhaps more nuanced and it is this, that within Victoria there is a number of separate offices or branches, as it were, which are separated within the state of Victoria which tends towards geographic diversity within the space of Victoria because of those six branches.

PN101

In no way is the concession made by the respondent of geographical distinctness when all facts and matters are considered. It is just not the case and it is very much allied to the next submission that is made about arbitrariness on page 8, paragraph 32, that when one looks at the way in which the argument is being constructed by my learned friend as to geographic distinctness, it is entirely arbitrary to work within that Victorian framework, as it were, the Victorian geographical framework. And the authorities state clearly that arbitrariness in the choice of the group weighs heavily against the issuing of a majority support determination. It is a relevant matter, but it weighs against it if it is arbitrary and this really is at the heart of the fundamental attack on "fairly chosen" in this application when it comes to the question of geography because the evidence is Mr Lewis worked within Victoria as clearly Victorian based, had no interest in traversing any other branches, any other employees, focussed his concerns and interests and responded to interest that was communicated to him from within Victoria but kept it quarantined or sectioned off in that way.

PN102

The effect of that is to make that choice arbitrary in nature because - and it dovetails into another critical relevant consideration - like employees within the national focus or national operation are excluded and that is a relevant consideration in the Cimeco decision and the CFMEU that the exclusion of like employees from the proposed agreement is something that you will have regard to. Again, we dovetail back to the arbitrariness. It is just clear. It is simply not clear why there has been this quarantining or focus within Victoria in the context of no operational distinctness, no organisational distinctness and we say, ultimately, no geographic distinctness.

PN103

THE DEPUTY PRESIDENT: I don't know how many offices there are in Victoria, but what would bind them together?

PN104

MR HARRINGTON: In Victoria, there are six branches.

PN105

THE DEPUTY PRESIDENT: What would bind them together to give - - -

PN106

MR HARRINGTON: What binds them together is the national integrated practice. There is a level of state management within the State of Victoria. I don't dispute that, but I am not sure that my client wants me to describe their business like a pyramid, but there is a sense that there is management at the apex and that there is a national structure and there is a reporting up through that national structure. So you have got six branches in Victoria that feed into a state management tier that feeds up to the national management tier.

PN107

THE DEPUTY PRESIDENT: But there is a distinction - and it is probably something I will ask you, Mr Bakri, as well - there is a distinction here that has been made that Victoria is different to the other interstate branches.

PN108

MR HARRINGTON: We don't understand how that is put. We understand the evidence, but I don't understand how that is truly advanced.

PN109

THE DEPUTY PRESIDENT: Geographically, obviously, it is different. It is in Victoria as opposed to other states.

PN110

MR HARRINGTON: Yes, yes.

PN111

THE DEPUTY PRESIDENT: Then you have got the questions about operationally and organisationally distinct. There is much made of, well, these lawyers are different because they operate under the Victorian Workers' Compensation Scheme, or the insurance - - -

PN112

MR HARRINGTON: Yes.

PN113

THE DEPUTY PRESIDENT: - - - whether it is transport accident or the like. But for that, how integrated are the six Victorian branches to say that makes them a distinct organisational unit?

PN114

MR HARRINGTON: That is the submission we are making. Within Victoria there is not distinct - there is diversity. They are geographically diverse. There is evidence before you about where they are located.

PN115

THE DEPUTY PRESIDENT: Yes.

PN116

MR HARRINGTON: They are located in different places. They are not six shopfronts all in a row down the local High Street. They are in different places in Victoria. Mr Chrara gave clear evidence about that. I apologise off the top of my head, I can't recall the exact locale of them but I know that it is in his statement.

PN117

THE DEPUTY PRESIDENT: But isn't there a question to be answered - - -

PN118

MR HARRINGTON: Paragraph 21, sorry. It is Ballarat, Dandenong, Geelong, Melbourne, Reservoir, Sunshine.

PN119

THE DEPUTY PRESIDENT: But isn't there a question to be answered here that to say that Victoria is distinct from New South Wales and WA and Queensland, doesn't that same argument flow but for the legislative schemes that operate within Victoria that are distinct from the other states. There is material that the parties are putting on that. But that apart from that, the Ballarat office would operate differently or distinctly to the - I don't know the other offices you just said.

PN120

MR HARRINGTON: Sorry, yes, well, there is Ballart, Dandenong, Geelong, Melbourne, Reservoir, Sunshine, yes.

PN121

THE DEPUTY PRESIDENT: How much integration is there between Dandenong and Geelong and Ballarat? I mean, they are all going to be - - -

PN122

MR HARRINGTON: I am very carefully about speaking from the Bar table about these matters because I don't know that it will be probably to do that, other than they work within the framework of the Victorian compensable injury law, whether it be traffic or worker's compensation, so lawyers - - -

PN123

THE DEPUTY PRESIDENT: But is that the only factor?

PN124

MR HARRINGTON: Sorry?

PN125

THE DEPUTY PRESIDENT: Is that the only factor in the end that makes Victorian operations different to Queensland, WA, New South Wales?

PN126

MR HARRINGTON: The evidence before you, as advanced on the question of distinctness, because that is my learned friend's case, he is saying, "Well, the statutory scheme in Victoria is different to Queensland, for example." So there are differences and he doesn't advance a case for distinctness really much beyond that because within Victoria, you have six distinct geographic locations all employing lawyers, most of whom are working in that personal injuries sphere. Any of those solicitor/lawyer employees could move between offices because obviously it is the statutory schemes within Victoria.

PN127

THE DEPUTY PRESIDENT: But they don't or do they? I mean, there wasn't any evidence on that.

PN128

MR HARRINGTON: No, there wasn't evidence. There was intra - - -

PN129

THE DEPUTY PRESIDENT: I mean, if you are located in Ballarat, you are not going to suddenly go and do work in Dandenong unless it is on a particular file that might require that to be done. I don't know.

PN130

MR HARRINGTON: Careful debating hypotheticals, but what I want to say about that is your skillset is entirely transferrable between offices within the state because as - - -

PN131

THE DEPUTY PRESIDENT: I guess my question is if you are carving out Victoria, why would you not then go a further subset of that and say: "Well, you can carve out Ballarat and you can carve out Dandenong." If the only thing that makes the practice of Shine in Victoria distinct is the legislation that these lawyers work under, well, what is the difference then? If that is the only difference, why is Victoria so distinct? Why wouldn't it be each Shine office is then distinct on that argument?

PN132

MR HARRINGTON: I understand the way you are putting that and, of course, the case that we have advanced in the evidence is that there is a national framework of shared services and the like, so you have got six branches in Victoria and there is a uniformity in respect of how the business operates.

PN133

THE DEPUTY PRESIDENT: Yes.

PN134

MR HARRINGTON: There are services fed down, there is management, edicts fed down, there is a salary banding. There is those sorts of things that are fed through all the offices which means there could be distinctness between officers within Victoria, but at the same time because of the national framework of the law practice itself, there is similarity within Victoria just as there is across all the other states. What my learned friend seeks to do is to call what we have determined is very weak evidence to somehow silo Victoria and say there is something organisationally, operationally and geographically distinct about this.

PN135

THE DEPUTY PRESIDENT: That is really my question. That is really my question. I mean, no doubt the parties will address me on this, but one can't help but get the impression that this is largely an application built around the organisational convenience for the ASU.

PN136

MR HARRINGTON: That is a submission we have made from the outset.

PN137

THE DEPUTY PRESIDENT: But, you know, why is any Victorian - apart from the legislation and there might be other things and I am putting it at too high a level and Mr Bakri will have a chance to respond to this, but apart from the legislation, what is different about Victoria because if it is just the legislation - - -

PN138

MR HARRINGTON: The compensable injury schemes that operate, as it were, like TAC, the Transport Accident Act and workers' compensation, yes.

PN139

THE DEPUTY PRESIDENT: Yes, but if there is six different offices in Victoria, I mean, is there a Victorian head office? Is there - - -

PN140

MR HARRINGTON: On the evidence there is not. There might be an office that has got more employees than a different office. I would concede that, but - - -

PN141

THE DEPUTY PRESIDENT: I mean, ultimately there will be some sort of a Victorian manager.

PN142

MR HARRINGTON: Yes.

PN143

THE DEPUTY PRESIDENT: But, you know, that might be for reporting and the national structure and all that sort of thing.

PN144

MR HARRINGTON: Yes, and Mr Chrara says the branch managers in Victoria report to Stuart Le Grand, national litigation principal, Acting General Manager Victoria. There is evidence that, yes, there is a general manager in Victoria. Mr Chrara himself effectively heads up New South Wales. But the point about the evidence in Mr Chrara's statement commencing at paragraph 20, staff composition, 98 employees in Victoria, 99 in New South Wales, 483 in Queensland, and then he sets out the locale of the branches. Then he goes on his statement at 26 to talk about the national integration of shared services, the centralised client intake function, recoveries and settlements and the like.

PN145

The complexion, the reality of the business, is that it is a national business, nationally run, nationally operated. It doesn't seek to differentiate offices at a geographic state level. It doesn't seek to do that. My learned friend says: "Well, that's what has happened." That Victoria is just different. It is not distinct. It is not different. The operation of the organisation are not different here save for the fact that the workers themselves, the lawyers and the support staff work to particular statutory regime in trying to get results for the people they represent. But they do that all around Australia and that is the next submission that is made at paragraph 38, page 9, not operationally distinct, Deputy President.

PN146

THE DEPUTY PRESIDENT: Sorry, this is yours or theirs?

PN147

MR HARRINGTON: Yes, no, this is ours at 38. The group he has chosen is not operationally distinct. The submission is that it seeks to conflate an operational function that is common to all Shine offices. The practice of law with the assistance, of course, of support staff in the personal injury jurisdiction for the most part with the alleged geographical distinction of the group. The industrial or productive activity is not distinct to Victorian branches or Victoria itself. The carrying out of the legal duties and legal skills with the aid of support staff is not distinct to Victoria.

PN148

Finally, and I have gone well over my time, you will see that we make the submission in terms of "fairly chosen" that you should have regard to the evidence of the national integrated practice. Really, in a lot of ways, I have just been addressing you on that just then. The submission I go on to make then is that at paragraph 83 of the statement by Mr Chrara where under the heading "Integrated National Firm" starting at paragraph 81, 82, and then paragraph 83: "Potential implications of Victorian enterprise agreement, (a), (b), (c) and (d) are set out there.

PN149

To some extent that is a lay opinion. It is opinion evidence. But it is entirely admissible and relevant because they are the concerns that Mr Chrara has in terms of productivity and efficiency type considerations that if there is no true distinctness, and that is our submission, there is not, particularly when one considers 237(3A), there is no true distinctness and the Commission effectively authorises by a majority support determination a fragmentary approach to collective bargaining in the state of Victoria.

PN150

THE DEPUTY PRESIDENT: But where does that fit within section 237(2)? I mean, this is what the employer is saying about the impact of orders being made in the terms sought. Where does that fit within?

PN151

MR HARRINGTON: The Full Bench tells us that it fits - and I think it was Lewin C in the Alcoa decision said that 2C, "fairly chosen", embraces or takes into account employer considerations.

PN152

THE DEPUTY PRESIDENT: Right.

PN153

MR HARRINGTON: I believe I have. I don't know that we handed it.

PN154

THE DEPUTY PRESIDENT: Was that addressed in the Full Bench decision?

PN155

MR HARRINGTON: That is a good question because my instructor helpfully just handed me the Full Bench decision, but I remember reading it particularly in the first instance decision.

PN156

THE DEPUTY PRESIDENT: Mr Bakri might know because he was in the case.

PN157

MR HARRINGTON: Well, he is the expert. He has already had a go us saying that apparently, we have conflated or confabulated - there is a better word - we confabulated something and misinterpreted the decision that he was in, the Alcoa decision.

PN158

THE DEPUTY PRESIDENT: Yes.

PN159

MR HARRINGTON: But I think he has backed away from that now. But, Mr Bakri, I don't think he appeared downstairs or I could be wrong about that. Did you appear in front of - no. Yes, he didn't appear downstairs, but I do recall that Lewin C made - in fact, I know where it will be. In the respondent's outline of submission, I took you to paragraph 12 before. At 12(f): "In assessing 'fairly chosen', the interests of the employer to be considered including questions of enhanced productivity and efficient conduct of the business."

PN160

THE DEPUTY PRESIDENT: Sorry, is this the closing or the - no, 12(f).

PN161

MR HARRINGTON: Sorry, yes, 12(f) of the respondent's outline.

PN162

THE DEPUTY PRESIDENT: Of the originals, yes.

PN163

MR HARRINGTON: You will see that I have just answered your question by saying it is "fairly chosen". I think, yes, the footnoting is over the other side of the page 26, CFMEU v Alcoa, and that is the first instance decision at 71.

PN164

THE DEPUTY PRESIDENT: Yes.

PN165

MR HARRINGTON: So that is how you work in the employer perspective or the employer concerns or interests as it were. Can I finish by making reference to - - -

PN166

THE DEPUTY PRESIDENT: You are saying that wasn't disturbed or adversely commented upon?

PN167

MR HARRINGTON: No, that is what I have said at paragraph 12 or it is footnoted. Well, later appealed but permission not granted. There was no adverse comments by the Full Bench. In fact - my learned friend can correct me if I am wrong - the Full Bench may have endorsed that approach, but I will stand corrected if I have got that wrong. In my learned friend's submissions, he referred to the National Union of Workers v Cotton On Group first instance decision. Cotton On Group v National Union of Workers was a Full Bench decision to which we had regard and took you to.

PN168

THE DEPUTY PRESIDENT: Yes.

PN169

MR HARRINGTON: He went back to in his submissions - in my learned friend's submissions at paragraph 12.

PN170

THE DEPUTY PRESIDENT: Yes, I have that.

PN171

MR HARRINGTON: Yes. It said that the leading decision on "fairly chosen" is Roe C's decision on NUW v Cotton On. I don't agree it is the leading decision, but there is a decision by Roe C and it was affirmed in a brief decision by the Full Bench saying he didn't fall into error, he got it right and I accept that.

PN172

THE DEPUTY PRESIDENT: Yes.

PN173

MR HARRINGTON: What Roe C did is he - can I take you to it. I think my learned friend will have a copy of this decision for you. I will just read from paragraph 26. I thank my learned friend. He is going to hand a copy of this.

PN174

THE DEPUTY PRESIDENT: But the Cotton On decision, didn't that just involve two warehouses?

PN175

MR HARRINGTON: Warehouses, yes.

PN176

THE DEPUTY PRESIDENT: But both in the state of Victoria?

PN177

MR HARRINGTON: No, I think one was in Wacol in Queensland.

PN178

MR BAKRI: One in Victoria, another was interstate.

PN179

THE DEPUTY PRESIDENT: All right, thank you.

PN180

MR HARRINGTON: Yes, they were in separate locations.

PN181

THE DEPUTY PRESIDENT: All right. So this is at tab - - -

PN182

MR HARRINGTON: So it's the single instance - first instance decision of NWU v Cotton On 2014.

PN183

THE DEPUTY PRESIDENT: Yes, thank you.

PN184

MR HARRINGTON: Tab 4.

PN185

THE DEPUTY PRESIDENT: What paragraph?

PN186

MR HARRINGTON: I am taking you to paragraph 26.

PN187

THE DEPUTY PRESIDENT: Yes.

PN188

MR HARRINGTON: You will see in the first line and I will quote:

PN189

Cotton On referred to the decision of Siopis J in John Holland Pty Ltd v CFMEU and FWC.

PN190

I have taken you to that, although I didn't hand up a copy.

PN191

This decision related to the approval of an agreement not to a majority support application. Siopis J considered that the criteria in section 186(3A) concerning geographic, organisational or operational distinctiveness to be "legitimate business related characteristics". He considered that this was "to preclude approval of an agreement which excludes an employee or number of employees from the benefit of being covered by an agreement for an extraneous characteristic". Cotton On argues that to exclude others who have the same legitimate business related characteristic would therefore mean that the group had not been fairly chosen. Cotton On argues that because the distribution centre managers in each centre report to a common manager and the distribution centres are in other ways integrated operationally and organisationally they have a common business related characteristic and all employees with that common characteristic must be included for the group to have been fairly chosen.

PN192

I take you to that because I am sure my learned friend will take you to that decision just to draw your attention to that nifty effective sound bite: "The common business related characteristic." That is Justice Siopis. My learned friend will take you to paragraph 27 and say that Roe C says: "I do not accept that argument." He didn't accept the argument of the Cotton On Group, but I don't rely on that argument. What I would draw your attention to is what Justice Siopis said in that decision about common business related characteristics and the potential for employees to be excluded because of the consideration of an extraneous characteristic.

PN193

On the evidence that has been adduced before you and it is strongly compelling evidence from Mr Chrara, there are common business related characteristics across all of the Shine operations across all of the offices. Justice Siopis was concerned with approval of an agreement, but I have taken you to 186(3) and (3A) and you will see it is the same statutory language as 237(3) and (3A).

PN194

In this matter as opposed to the Cotton On decision, in the matter before you the geographical distinctness is not accepted, it is contested, and the organisational and operational distinctness as you will read in our submission is highly contested and we reject vigorously that there is organisational or operational distinctness in the choosing of this group, Deputy President. Unless there are any other matters that I can assist you with, those are the submissions.

PN195

THE DEPUTY PRESIDENT: Thank you. Could you just expand on your statement in your closing submissions in relation to section 237(2)(d), reasonableness? What am I to make of that?

PN196

MR HARRINGTON: That is not pressed.

PN197

THE DEPUTY PRESIDENT: But it is not a submission to say that you consider it is reasonable in the circumstances?

PN198

MR HARRINGTON: We don't. We don't press unreasonableness and we don't make any submission on reasonableness per se in the circumstances. As we advanced to start with, it was an alternative ground. It was not fairly chosen and otherwise unreasonable. So it's a stand-alone ground. We are not pressing it as a stand-alone ground, but we don't concede reasonableness.

PN199

THE DEPUTY PRESIDENT: Yes, thank you. Thanks, Mr Bakri, yes.

PN200

MR BAKRI: Thank you, Deputy President. We have filed a detailed outline of closing submissions which we rely on.

PN201

THE DEPUTY PRESIDENT: Yes.

PN202

MR BAKRI: In those circumstances, I don't intend to take you through the entire document and unnecessarily repeat the submissions that have been made. What I intend to do is briefly take you through the key principles that we say should be applied in the present matter and then provide a response to the respondent's submissions where appropriate. By way of introduction, I intend to develop the following contentions in response to the respondent's submissions.

PN203

Firstly, that the respondent effectively calls on the Commission to approach the question of distinctness in 237(3A) in an absolute sense and not as a matter of degree as the authorities say you should. Secondly, the respondent does not fairly characterise the evidence that was given during the hearing. The respondent has ignored the body of evidence that on any reading indicates distinctness in the requisite sense and has instead adopted a broad-brush approach that unhelpfully refers to self-serving terms such as: "The nationally integrated practice."

PN204

Thirdly, that the respondent misunderstands the significance of the views of employees in a majority support determination application and I intend to take you through the applicable authorities. Fourthly, that the respondent's submissions fail to appreciate the limited consequences that flow from a majority support determination and how that impacts on the exercise of your discretion pursuant to section 237.

PN205

Finally, the final broad submission we make is that the respondent erroneously describes the chosen group as arbitrary when such a description is simply not open on the evidence. So I will develop each of those broad submissions as I go through particular parts of the respondent's submissions.

PN206

THE DEPUTY PRESIDENT: Thank you.

PN207

MR BAKRI: If I could now briefly address the key principles. As my learned friend rightly pointed out, we at paragraph 12 of our outline of closing submissions, we direct your attention to Roe C's decision in the NUW v Cotton On which is in the folder of authorities that we have handed up.

PN208

THE DEPUTY PRESIDENT: Yes.

PN209

MR BAKRI: We don't resile from describing that decision as the leading decision and we say that it was affirmed by Watson VP, Gostencnik DP and Bissett C on appeal. It is submitted in the circumstances of this case that the decision at first instance which goes in to some detail as to the applicable principles should be followed when determining this application. If I could take you to the key passages in that decision at first instance, if you could please turn to tab 4.

PN210

THE DEPUTY PRESIDENT: Yes.

PN211

MR BAKRI: So Roe C's decision, in my submission, provides a detailed consideration of the task that you must now perform. We refer to a number of passages in our outline. I will take you to two key passages. Firstly, at paragraph 18 which is on page 4.

PN212

THE DEPUTY PRESIDENT: Yes.

PN213

MR BAKRI: The penultimate sentence reads: "For the purposes of a majority support determination and for the purposes of agreement approval" - he is drawing a nexus between section 327 and the agreement approval provisions - "there is no requirement to decide what would be the fairer or the fairest group. There may be a number of alternative groups which could be fairly chosen." It is important, Deputy President, that it is accepted that it matters not whether a national agreement would be more fairly chosen or whether a branch by branch agreement would be more fairly chosen. Adopting such an approach would be an error as the question here is: is the group that is proposed by the applicant fairly chosen within the meaning of section 237 or not?

PN214

It may well be that a national agreement is also fairly chosen and it may well be that a single branch or a different combination of branches would also be fairly chosen. Perhaps even an eastern states agreement would be fairly chosen. That is completely irrelevant to the question at hand and could only distract from the task with which the Commission is charged under 237. Secondly, I would take you to paragraph - - -

PN215

THE DEPUTY PRESIDENT: I find that interesting that you just look at this. There is no comparator. You just look at it in terms of: is this fair?

PN216

MR BAKRI: Yes, that is my submission and it is for this reason.

PN217

THE DEPUTY PRESIDENT: There is no comparator at all? Is that what you are saying?

PN218

MR BAKRI: No, no, the question is, you look at this group and whether that group is fairly chosen. Of course, you need to take into account the business as a whole, of course. If that is what you mean by comparator, I concede that, otherwise what are you going to determine?

PN219

THE DEPUTY PRESIDENT: Yes, yes, how do you determine the question?

PN220

MR BAKRI: But you can't look at my client's group and compare that to other hypothetical groups - irrelevant consideration and it distracts from the task of is this group that is proposed that is the subject of the application, is that group fairly chosen or not.

PN221

THE DEPUTY PRESIDENT: Yes, there is an air of artificiality about that, though, isn't there? Because - - -

PN222

MR BAKRI: Perhaps I can explain it this way, your concern about the artificiality, and it goes to the purpose of this application. I am going to come back to this later. All a majority support determination does is kick off bargaining to describe it in casual way. It will require a notice of employee representational rights to be issued and it will require the parties to commence bargaining under the pain of bargaining orders. That is all it does. It does not prescribe the final scope of the agreement. It can't presuppose the terms of any agreement. The parties are still at liberty to put forward claims as to scope as often happens and negotiate those claims and the parties are at liberty to apply for a scope order. So it is a very limited task and that needs to be borne in mind when assessing whether the group is fairly chosen or not.

PN223

THE DEPUTY PRESIDENT: It seems strange that, say, in this scenario where there is an obvious dispute between the parties as to essentially a dispute as to scope when it comes down to it. Shine is saying: "We are opposing this application because we don't think the scope of the agreement that would be proposed by this stream of bargaining is appropriate for our business and our operation." So isn't this just a precursor to a further dispute about scope?

PN224

MR BAKRI: But the consequences of the determination being granted need to be taken into account and I want to develop this idea. But because this is merely a majority support determination application the consequences are just that bargaining commences. There are actually no more serious consequences. Shine would be at liberty to take steps to seek to secure a more national agreement and the Commission can't presuppose what the outcome of bargaining will be when deciding.

PN225

THE DEPUTY PRESIDENT: No, I accept that, but it gets back to that question then about what weight does the view of the employer have in a majority support determination.

PN226

MR BAKRI: Yes.

PN227

THE DEPUTY PRESIDENT: This might take on a life if bargaining commenced and ran its course.

PN228

MR BAKRI: Yes.

PN229

THE DEPUTY PRESIDENT: There would be all sorts of things that could happen under the Act. They might not bargain, then there will be an application for bargaining orders and there might be - - -

PN230

MR BAKRI: There could be protected industrial action.

PN231

THE DEPUTY PRESIDENT: There could be protected industrial action. There could be all sorts of things. But I guess my question in this context is related to that question about what views or what do I make of the views of the employer here.

PN232

MR BAKRI: Can I come back to that?

PN233

THE DEPUTY PRESIDENT: Sure.

PN234

MR BAKRI: I wanted to address that in a particular context, if that is okay, Deputy President.

PN235

THE DEPUTY PRESIDENT: Yes.

PN236

MR BAKRI: Before I leave this decision, there are two more passages I want to emphasise.

PN237

THE DEPUTY PRESIDENT: Yes.

PN238

MR BAKRI: Firstly, paragraph 25, from the second sentence.

PN239

THE DEPUTY PRESIDENT: Yes.

PN240

MR BAKRI: Commissioner Roe states:

PN241

Collective bargaining would not be enabled if majority support determinations were made more difficult to achieve because the employer was able to oppose the electorate on the grounds that it's choice of electorate should be preferred or that it better suited it's bargaining interests. The only constraints which apply to the choice being made by the employee bargaining representatives are that the group be fairly chosen and that the Fair Work Commission considers that it is reasonable to make the determination.

PN242

THE DEPUTY PRESIDENT: Yes.

PN243

MR BAKRI: It is quite a narrow task there and it should not be controversial. The next paragraph is paragraph 27 and this is, in my submission, the key passage in the decision in which - and I won't read that entire paragraph, but the crux of it is that Roe C says that distinctness is not to be considered in an absolute sense, but is a matter of degree. That is a notion that, in my submission, that has become well-established over time in this Commission and on appeal the decision was affirmed. So if you turn tab 3. Have you got a decision?

PN244

THE DEPUTY PRESIDENT: Yes.

PN245

MR BAKRI: At paragraph 8 over on the third page, the second sentence on the third page, the Full Bench observed:

PN246

Rather than consider the question of distinctness in an absolute sense, he considered that the concept was more a matter of degree and the warehouse employees could be distinct from some other employees in some respects and distinct from some other employees in others. He did not consider that the group needed to be unique within the corporation in order to be distinct in a relevant sense. He considered the factual position on these matters in the course of reaching a finding that the group of employees subject to the determination was fairly chosen.

PN247

It is quite important that it is recognised that it is not distinctness in an absolute sense and we don't need the chosen group, the group that has been chosen by the union, to be unique. That is not the type of distinctness which is being referred to in the provision.

PN248

THE DEPUTY PRESIDENT: What was the basis of Cotton On's objection, though? Was it that there were at this site, warehouse and non-warehouse employees, or was it on the geography?

PN249

MR BAKRI: I believe, and I will stand corrected if I get this wrong on my feet, that Cotton On contended that they went for the trifecta. They argued that there was no - no, I withdraw that. There was no organisational or operational distinctness. That was the submission. I believe it was conceded appropriately that there was geographic distinctness.

PN250

THE DEPUTY PRESIDENT: So they didn't run the case on geography?

PN251

MR BAKRI: I believe that they didn't, yes.

PN252

THE DEPUTY PRESIDENT: All right.

PN253

MR BAKRI: In my submission, the manner in which the respondent effectively approaches the question of distinctness is in an absolute sense. You will be told that that is not what they are doing, but in my submission, it is. Now I want to turn to the submissions made by the respondent in relation to this issue of the significance of the majority of employees wanting to bargain.

PN254

THE DEPUTY PRESIDENT: Yes.

PN255

MR BAKRI: The relevant part of the respondent's submissions is paragraph 28 and 29.

PN256

THE DEPUTY PRESIDENT: We are talking closing or the - - -

PN257

MR BAKRI: The closing. So whenever I refer to the respondent's submissions, it will be the closing.

PN258

THE DEPUTY PRESIDENT: It will be the closing, thank you.

PN259

MR BAKRI: Yes.

PN260

THE DEPUTY PRESIDENT: Yes, so at 28 and 29, you are saying?

PN261

MR BAKRI: Yes, at 28 and 29, the respondent submits that the Full Bench in Kwinana was in error to conclude that the views of the employees prima facie carry greater weight than the subjective views of the employer and that the decision should not be applied in the context of a 237 application and my learned friend elaborated on that submission a moment ago. The first submission that I make in response is that the Kwinana decision was considered and followed by the Full Bench in Alcoa and the CFMEU which was an appeal of the majority support determination decision by Lewin at first instance. You will find that decision behind tab 1 of our folder.

PN262

THE DEPUTY PRESIDENT: Yes.

PN263

MR BAKRI: The relevant passage is paragraph 27. I won't read the entire passage. I will leave you to do that subsequently.

PN264

THE DEPUTY PRESIDENT: Yes.

PN265

MR BAKRI: But the effect of the passage is that the Full Bench endorsed Kwinana and found that the wishes of the employees to bargain should be given significant weight in the absence of a countervailing case that the selection of the group would be prejudicial to the productivity or efficient conduct of the employer's business. In my submission, in accordance with the orthodox approach, you should act consistently with these two Full Bench decisions. That is both Kwinana and Alcoa.

PN266

THE DEPUTY PRESIDENT: But there is two things there, though, isn't there? There is one, the unanimous wish of the relevant group of employees and we don't necessarily have that here. And then absence of a countervailing case to the selection of the group would be prejudicial to the productivity or efficient conduct. Isn't that two distinguishing features here in this case?

PN267

MR BAKRI: That is correct. It is not unanimous in this case. It is - - -

PN268

THE DEPUTY PRESIDENT: It is 59 out of, what, 89 or something?

PN269

MR BAKRI: There is, we would say, a high number of people voted in favour.

PN270

THE DEPUTY PRESIDENT: But it is not unanimous.

PN271

MR BAKRI: It is not unanimous, that is conceded, and further to that it has got to be recognised that it was a postal vote and not everyone voted. So you have got to look at the number of people that voted "yes" and "no" and it is a very high number, almost unanimous out of those that participated in the vote. I am instructed that it was 59 out of 61 votes, so almost unanimous.

PN272

THE DEPUTY PRESIDENT: All right.

PN273

MR BAKRI: So that is what we say there.

PN274

THE DEPUTY PRESIDENT: But out of those who voted.

PN275

MR BAKRI: Out of those that voted. Out of those that voted.

PN276

THE DEPUTY PRESIDENT: Is there a distinction I should draw between those that voted and the total number?

PN277

MR BAKRI: In my submission, in assessing the views of employees, you should take into account those that voted. Those are the only employees who have expressed a view. We have no evidence. We don't know why the others didn't vote.

PN278

THE DEPUTY PRESIDENT: We don't know why the others didn't. Yes, all right.

PN279

MR BAKRI: Were they overseas, were they sick; we don't know.

PN280

THE DEPUTY PRESIDENT: All right.

PN281

MR BAKRI: On the question of is there a countervailing case, in my submission, no, and I want to come back to that in the context of something else that the respondent submits if that is acceptable to you.

PN282

THE DEPUTY PRESIDENT: You would be saying there is a case against being put, but it is not countervailing.

PN283

MR BAKRI: It is not countervailing. It is not a cogent evidentiary case.

PN284

THE DEPUTY PRESIDENT: All right, yes. And that is the evidence you rely on to say that the training is not an issue, the reports that go through to the national leadership team - - -

PN285

MR BAKRI: What I will do, I will now deal with the countervailing case. It seems convenient.

PN286

THE DEPUTY PRESIDENT: All right.

PN287

MR BAKRI: The respondent at 41 submits that Shine business interests and imperatives are to be considered, particularly the efficient conduct of the business.

PN288

THE DEPUTY PRESIDENT: Yes.

PN289

MR BAKRI: In response, it is submitted that in light of Kwinana and Alcoa, what you need to be satisfied of is a clear countervailing case that the selection of the group would be prejudicial to the productivity or efficient conduct of the Shine business and, in my submission, the respondent has failed to establish any such prejudice. Mr Chrara's evidence at paragraph 83 of his witness statement is relied on. I might let you turn that up if that is easy to do.

PN290

THE DEPUTY PRESIDENT: Yes, I will go to Mr Chrara's.

PN291

MR BAKRI: Mr Chrara at 83.

PN292

THE DEPUTY PRESIDENT: Yes, yes.

PN293

MR BAKRI: Our response to this evidence is that it is entirely speculative and of no probative value. Mr Chrara states: "I fear that this might have a number of adverse commercial and operational implications." The evidence is, in my submission, of no assistance as it presupposes that an enterprise agreement will be made in particular terms. As observed in the Alcoa appeal decision at 31, to attempt to predict what the outcome of enterprise bargaining might be if a majority support determination is made and then to have regard to that in deciding whether such a determination would be made would involve the Commission taking into account an entirely speculative and irrelevant decision. Further to that, during cross-examination Mr Chrara conceded that, firstly, there is some disparity between the wages paid to employees engaged in the same position and that is at PN606.

PN294

THE DEPUTY PRESIDENT: Yes.

PN295

MR BAKRI: He also conceded that there was disparity between the wages in cities and regional areas; PN609. And he conceded that there were some differences in conditions and wages between states; PN608. In this context, not much can be made of Shine's claimed concerns about the implications flowing from disparate and/or inconsistent terms. In addition to that, the primary submission is that that is entirely speculative evidence that really does not assist. We would say that the evidence falls well short of establishing the countervailing case of prejudice.

PN296

I want to move onto another topic and that is the issue of the chosen group and whether it can be impugned on the basis that it is arbitrary. At paragraph 32, the respondent makes the claim that the chosen group is entirely arbitrary. I will just turn that up. Mr Lewis gave unchallenged evidence that the scope of the proposed agreement reflects the group of employees who have approached the applicant and asked for the applicant's assistance as a bargaining representative to negotiate an enterprise agreement with the respondent and the reference is exhibit A1 at paragraph 23 and PN369. There was no challenge at all to Mr Lewis' evidence in this regard so it must be accepted.

PN297

THE DEPUTY PRESIDENT: What was the statement? A?

PN298

MR BAKRI: In the statement it is 23.

PN299

THE DEPUTY PRESIDENT: Twenty-three.

PN300

MR BAKRI: The transcript, I have got a transcript reference here of 369.

PN301

THE DEPUTY PRESIDENT: Yes.

PN302

MR BAKRI: The approach that has been adopted by Mr Lewis and the ASU is entirely consistent with the Fair Work Act's bargaining scheme which confers rights on a union to act as a bargaining representative only when it is appointed by employees as their bargaining representative. In response to the respondent's submission on arbitrariness, in addition to Cimeco v the CFMEU, which we refer to at paragraphs 19 and 20 of our outline, we rely on the decision of Justice Siopis in John Holland v the CFMEU which is the decision that my learned friend took you to. We have a copy which I can hand up if that is convenient.

PN303

THE DEPUTY PRESIDENT: Yes, thank you.

PN304

MR BAKRI: As my friend explained, this decision concerned the operation of the fairly chosen requirement in the agreement approval provision, specifically section 186. At paragraph 32 of this decision, his Honour refers to the three criteria of geographical, operational and organisational distinctness as legitimate business related characteristics and goes on to say that these criteria preclude an agreement being approved that excludes an employee "for an extraneous characteristic of the kind referred to in paragraph 30."

PN305

What we then need to do is go back to 30 and it is apparent that here his Honour was referring to - well, he provides the example of where employees are not included in the group because of their place of birth or their support of a particular political party. That is what he describes as examples of extraneous characteristics which is improper to include when selecting the group.

PN306

Both Cimeco and John Holland were agreement approval proceedings, but in our submission, they are relevant to the determination of the application under section 237 due to the similarity in the language used in the sections and we note that both of those decisions are referred to in the Cotton On decision and we say should be applied here.

PN307

THE DEPUTY PRESIDENT: It seems as though there is agreement that the principles outlined by his Honour in John Holland whilst dealing with section 186(3) are relevant to 237, it is just that you are both saying that the judgment does different things.

PN308

MR BAKRI: Yes, it appears that way.

PN309

THE DEPUTY PRESIDENT: Yes, all right.

PN310

MR BAKRI: In my submission, Cimeco and John Holland give a very narrow meaning to the fairly chosen requirement.

PN311

THE DEPUTY PRESIDENT: Yes.

PN312

MR BAKRI: Just following on from the point that, Deputy President, you just made, it is possible that albeit this is a majority support determination application, any decision could have a bearing on decisions that concern agreement approval. So there is a nexus between those two provisions. The decisions, in my submission, provide the - - -

PN313

THE DEPUTY PRESIDENT: There is a long way to go between - there could be a long way to go in this scenario between a majority support determination and agreement approval.

PN314

MR BAKRI: And the final agreement.

PN315

THE DEPUTY PRESIDENT: Yes.

PN316

MR BAKRI: I won't hazard a guess how long it will take.

PN317

THE DEPUTY PRESIDENT: No, well, nothing has been easy so far.

PN318

MR BAKRI: In my submission, the decisions in Cimeco and John Holland provide that the fairly chosen requirement is there to guard against arbitrariness and discrimination and the present circumstances do not fall within this narrow concept that "fairly chosen" is there to guard against.

PN319

THE DEPUTY PRESIDENT: Sorry I keep interrupting you, but the arbitrariness here, and you will probably address me on this, isn't this all just about geography?

PN320

MR BAKRI: No. In my submission, no, it is about a lot more.

PN321

THE DEPUTY PRESIDENT: All right.

PN322

MR BAKRI: But we say it is not arbitrary. We say that Mr Lewis provided clear evidence on why this group was chosen. Mr Lewis is a union official. He can't be a party to an agreement. He, as an officer of the union, has been approached to negotiate on their behalf in Victoria. He works in Victoria and that is the reason. That is not an arbitrary reason. It is not that the union has just plucked out of the sky a particular scope of agreement. It is an objective and reasonable basis for the union to be seeking a Victorian based agreement. Now, at paragraph 33 - - -

PN323

THE DEPUTY PRESIDENT: Why wouldn't some other scope be chosen by Mr Lewis?

PN324

MR BAKRI: Well, that takes us back to - - -

PN325

THE DEPUTY PRESIDENT: The fact is, these people are in Victoria.

PN326

MR BAKRI: Yes.

PN327

THE DEPUTY PRESIDENT: It is a Victorian agreement that is sought. It is got an air of arbitrariness about it.

PN328

MR BAKRI: But if Mr Lewis organised the entire country, for example, and there was no explanation why it was limited just to Victoria, maybe that would be arbitrary. But it is not arbitrary for a union official to seek to assist a group of employees that have approached him to negotiate an agreement. It is a sound, reasonable and objective basis to select a group. Quite the opposite of arbitrariness, I would submit, and if we go back to - - -

PN329

THE DEPUTY PRESIDENT: Based on geography, though.

PN330

MR BAKRI: I want to come back to that. I took you to the passage in Roe C's decision where he warns against assessing whether one group is more fairly chosen than another and, again, we must be careful in assessing arbitrariness to not fall into the trap of considering other hypothetical groups and whether those groups would be preferable or not. We need to focus in on the group that has been chosen, that is the subject of the application, and the question is: is it fairly chosen or not?

PN331

THE DEPUTY PRESIDENT: The learned Commissioner has set me quite a task here, though, because I can see in the context of his case that is what he did. But in a contested application there is going to be a countervailing view and as the decision maker I have got to make something of that. The Commissioner is saying in his decision, well, whether there might be another group shouldn't come into it. But if a countervailing case is put or a case in opposition is put, isn't there an element of the respondent in that context saying: "Well, this group is not fairly chosen because there are other factors you have got to bear in mind"?

PN332

MR BAKRI: But in undertaking the task under 237, because of the wording of the legislation, you need to focus on whether this group is fairly chosen. That is not to say you don't consider the submissions that are made. It is trite that you must consider.

PN333

THE DEPUTY PRESIDENT: Section 237 in the scenario before the Commissioner, and again I don't now, but it doesn't call for a party opposing to say: "Well, look, there is another group that would be fairer." I accept the section doesn't say that, but if the application isn't by consent, a party opposing it is saying: "Well, this isn't fair for these reasons." It might not necessarily say there is a fairer group, but it might just say it is not fair for these reasons.

PN334

MR BAKRI: Yes, yes, and, of course, that must be taken into account, but that is different. Here, the employer says - and I don't want to speak for them, but something to the effect of: "We have got a national integrated business" - whatever that means - "so therefore this group is not fairly chosen." That is different from considering whether an agreement which would apply to all employees in Australia is more fairly chosen.

PN335

THE DEPUTY PRESIDENT: But they are not saying that. I don't understand their case to be - - -

PN336

MR BAKRI: No, they are not saying that and my submission is care needs to be taken to just focus on whether this group is fairly chosen or not.

PN337

THE DEPUTY PRESIDENT: Yes.

PN338

MR BAKRI: Taking into account the characteristics of the business, geographic elements, operational elements and organisational elements, but you are not to evaluate hypothetical different groupings and decide on which is the fairest.

PN339

THE DEPUTY PRESIDENT: Because you might have a situation where the employer doesn't want to bargain with anyone, doesn't want a collective agreement.

PN340

MR BAKRI: Yes, that's right.

PN341

THE DEPUTY PRESIDENT: Therefore, they would say: "Well, don't do that one, do this one." They might just say: "Don't do that." That might be their underlying - - -

PN342

MR BAKRI: That's right. That's right.

PN343

THE DEPUTY PRESIDENT: All right.

PN344

MR BAKRI: I want to address the submission made at paragraph 33 about the relevance of the exclusion of non-Victorian employees. The employer says one effect of such arbitrariness in the choice of the group is the exclusion of Shine employees performing the same work but in different geographical locales. In my submission, the exclusion of non-Victorian employees is a neutral consideration in the present matter because there is no evidence of the views of the other employees and I direct you to the decision of Roe C in Cotton ON at paragraph 29. I now want to address the - - -

PN345

THE DEPUTY PRESIDENT: I know what you will say about Mr Lewis' evidence and what I am to make of that, but there is really no evidence of any employee.

PN346

MR BAKRI: Outside of the - - -

PN347

THE DEPUTY PRESIDENT: Apart from what Mr Lewis says about - - -

PN348

MR BAKRI: Yes, yes. What I say to that is this. We have the views of the employees in the petition.

PN349

THE DEPUTY PRESIDENT: By virtue of the vote and it starts and stops there.

PN350

MR BAKRI: That is what we rely on there and it is not in contest that the majority of employees from the chosen group want to bargain. All that is in contest is whether it is fairly chosen or not.

PN351

THE DEPUTY PRESIDENT: All right.

PN352

MR BAKRI: I will now move to geographical distinctness. The applicant's submissions in relation to geographic distinctness as set out at paragraphs 27 to 30 of our outline. The respondent has maintained its submission that the respondent's Victorian branches are not geographically distinct from those branches located outside of Victoria. In my submission, the submission made defies logic and must be dismissed. At paragraph 31, the respondent submits that where there is more than one geographic location involved, the idea of geographic distinctness loses any real significance. Properly viewed, the group of employees is not geographically distinct, but the opposite. The group chosen is geographically diverse as it traverses six branches in Victoria.

PN353

This submission, in my view, is misguided. It is well-established that the chosen group of employees can work in a single location or in a geographical subset of the total business and be geographically distinct and we rely on the appeal decision in QGC at paragraphs 47 and 21 and you will find that behind tab 5 of the folder. I will just hand - - -

PN354

THE DEPUTY PRESIDENT: Yes.

PN355

MR BAKRI: Here we say the chosen group is a subset of the respondent's workplaces and it is well accepted the group can be made up of multiple workplaces and still be geographically distinct from others. At 31, the respondent claims that there is superficial geographical separateness to the Victorian branches and in support of this sentence, the respondent sites the decision in BP Refinery Kwinana and provides the pinpoint reference of paragraph 13. The Kwinana decision, have you been handed a copy?

PN356

THE DEPUTY PRESIDENT: Yes.

PN357

MR BAKRI: Yes, I think you have.

PN358

THE DEPUTY PRESIDENT: Yes, I have got it. Just a minute.

PN359

MR BAKRI: I don't require you to look at it now, I just wanted to make sure that you had a copy. In my submission, the decision at 13 does not support the proposition that has been advanced by the respondent. Kwinana concerns quite a peculiar situation. At paragraph 13, the Full Bench found that a Commissioner's decision that two groups of employees were geographically distinct was in error because in the circumstances that he was considering, the employees were on the same worksite and separated by only a few hundred metres. So not much can be made of the Kwinana decision, in my submission. To conclude this point, the only finding that is open is that the group of employees that have been chosen are geographically distinct from the employees that are not in the chosen group. I will now move to - - -

PN360

THE DEPUTY PRESIDENT: My question around geography was you have got six branches in Victoria and, presumably, they are all subject to the Shine national training and other Shine KPIs and all the other measures that are set and administered nationally.

PN361

MR BAKRI: Yes.

PN362

THE DEPUTY PRESIDENT: But, really, they operate as distinct branches. The only thing that binds them together with other ones that were located in Victoria is the legislation under which some of them do their work.

PN363

MR BAKRI: In my submission, it is a bit more than that and I want to run through the particular parts of the evidence that we rely on. Starting with operational distinctness, it is submitted that the main industrial or productive activity that is performed by the chosen group of employees is the provision of legal services including administrative support in the state of Victoria. We say this on the basis that there is an appreciable difference between the industrial or productive activity that is conducted in Victoria when compared to other states.

PN364

I want to be clear that I don't submit that the distinctness is absolute. It is a matter of degree and the respondent's submission that there is no operational distinctness which is put in an absolute manner should be dismissed. At 39, the respondent submits that it is not a question of the degree of distinctness. It is not entirely clear to me exactly what that submission intends to say. But, in any event, the submission should be approached very cautiously. The applicant refers to the Full Bench decision in Cotton On which makes it clear that the question of distinctness should not be considered in an absolute sense but considered as a question of degree.

PN365

In paragraph 39, the respondent also submits that on the evidence there was no appreciable distinct difference as between offices in carrying out the activity. Contrary to what is submitted, a fair reading of the evidence given by Mr Chrara under cross-examination supports a finding that there is, in fact, an appreciable and distinct difference between the activity carried on in Victoria as opposed to other states and this evidence should not be glossed over.

PN366

At PN549, it was accepted that there is a degree of distinctness between the personal injury statutory regimes in each state. The witness described the differences as key differences in respect to worker's compensation in New South Wales and Victoria.

PN367

THE DEPUTY PRESIDENT: But that is just statutory interpretation, isn't it? They are still working as lawyers.

PN368

MR BAKRI: He explained that there is a difference in the legislation and - - -

PN369

THE DEPUTY PRESIDENT: Yes, but, really, come on. That would be like saying someone in Victoria who is not doing personal injury work is different from someone else in Victoria, isn't it? If all the Victorian employees are to be looked at, right, if they are not all doing the same work under a statutory regime, say, they are not doing TAC work or they are not doing worker's comp, how can you maintain that as an argument to say that, "Well, hang on", this is where it gets back to geography, doesn't it? Because if you are saying, well, the piece of legislation is different and it is got different requirements and you have got to interpret that because it is a New South Wales worker's comp law to Victorian worker's comp law.

PN370

If there is a Victorian lawyer for Shine not doing that worker's comp work and by virtue of that working with regard to different pieces of statute, I mean, some of the Shine work uses the Fair Work Act, how do you maintain that as an argument?

PN371

MR BAKRI: We maintain it this way. The authorities are clear that employees in the chosen group can be distinct from some employees in some ways and distinct from other employees in other ways.

PN372

THE DEPUTY PRESIDENT: What I am really struggling with here is if it is just the legislation, I find that hard because how can you say that if there is Victorian lawyers doing work in different practice areas that involve different pieces of legislation, that is different to your argument about worker's compensation and personal injury lawyers operating in Queensland as opposed to Victoria.

PN373

MR BAKRI: It may be, taking that hypothetical scenario, that an employee - - -

PN374

THE DEPUTY PRESIDENT: I don't think it is hypothetical.

PN375

MR BAKRI: But if an employee, my submission is this, an employee was practising in a different area, the situation for them might be different. There might be geographic distinctness but not operational distinctness. So it is not that it - - -

PN376

THE DEPUTY PRESIDENT: No, I am really struggling with this. I am really struggling with this because you are saying it is about the legal work they do.

PN377

MR BAKRI: It is about the industrial or productive activity that the group - - -

PN378

THE DEPUTY PRESIDENT: Which is a question of statutory interpretation.

PN379

MR BAKRI: - - - the group as a whole is doing. My learned friend has characterised that as lawyers doing legal work and I can see that argument and we are characterising it as lawyers doing legal work as Victorian lawyers in the state of Victoria.

PN380

THE DEPUTY PRESIDENT: Yes, but they are operating under different pieces of legislation within Victoria. That is my proposition.

PN381

MR BAKRI: Yes, and in relation to operational distinctness, that is what we are focussing on.

PN382

THE DEPUTY PRESIDENT: Yes, but what the question of geography then?

PN383

MR BAKRI: I don't understand the question.

PN384

THE DEPUTY PRESIDENT: That breaks down your operational distinctness argument about Victoria, doesn't it?

PN385

MR BAKRI: In my submission, it doesn't. You could have a workforce that is operationally distinct which happens to be on state lines as well.

PN386

THE DEPUTY PRESIDENT: But I am suggesting to you that that is illusory in this case. If your operational distinctness is built upon the fact that they are operating under Victorian statute as opposed to New South Wales or Western Australian or Queensland statute, my proposition is operating within the state of Victoria, there will be operational differences because you will have lawyers operating under different pieces of Victorian legislation and that is a level of distinctness as well.

PN387

MR BAKRI: I would concede that that would make those different employees distinct. The point that I make is that the employees don't all need to be distinct in the same way in relation to other employees. It might vary. On operational distinctness, we refer largely as you have correctly noted to the legislation. But in addition to that, we rely on the uncontested evidence concerning the lack of direct contact between Victorian employees and interstate employees which has been accepted to suggest operational distinctness. So we rely on the submissions that are made at paragraphs 36 to 38 of the outline.

PN388

THE DEPUTY PRESIDENT: Of your outline?

PN389

MR BAKRI: Yes, yes.

PN390

THE DEPUTY PRESIDENT: Yes.

PN391

MR BAKRI: You won't be surprised to know that I again refer you to Roe C's decision in Cotton On. He found there the fact that the employees in the warehouse were not having any contact with the interstate employees was a factor that militated in favour of finding operational distinctness.

PN392

THE DEPUTY PRESIDENT: But aren't we going to have the same thing here with your Ballarat, your Dandenong and your other branches in Victoria? Aren't we going to suffer from the same issue?

PN393

MR BAKRI: No, on the evidence, it was accepted that there was - and I am on my feet, I don't want to mischaracterise the evidence so I implore you to have a look. But there was some contact - - -

PN394

THE DEPUTY PRESIDENT: Yes, but I don't recall it as being, you know, they are ducking here, ducking there, ducking everywhere in Victoria.

PN395

MR BAKRI: The evidence didn't go that far, but there was evidence about employees in a branch having regular contact with each other. That would seem uncontroversial. Employees at branches within the state of Victoria - - -

PN396

THE DEPUTY PRESIDENT: Whose evidence did that come from?

PN397

MR BAKRI: This is Mr Chrara. And then employees having little cause to contact employees located in other states. I do remind you, Deputy President, that it is not an exercise where we need to tick all three boxes of geography, operationally and organisationally.

PN398

THE DEPUTY PRESIDENT: No, I accept that.

PN399

MR BAKRI: It could be that we satisfy you on geography and that is it. It is a question of degree.

PN400

THE DEPUTY PRESIDENT: I take into account those things, but none more than the other, I guess.

PN401

MR BAKRI: Now moving to organisational distinctness, it is submitted that the Commission should conclude that there is a degree of organisational distinctness. The respondent, in my submission, has ignored the evidence that indicates organisational distinctness by virtue of management at a branch level and state level. At paragraph 37, the respondent submits that Mr Chrara gave unchallenged evidence that the operation of a branch are administered at a national level but executed at branch level.

PN402

In referring to this evidence, the respondent is trying to diminish the management of employees that occurs at the state and branch level. Referring to this evidence in isolation, in my submission, does not fairly characterise the evidence that was given by that witness. At PN531, I asked Mr Chrara during cross-examination: "So you accept that there is a fairly high level of administration at the branch level?" He responded: "Well, there would be, yes." At PN532, I then asked him: "And the same applies at a state level, so the state manager is responsible for ensuring that the state business is tracking well as against state targets?" The answer from the witness was: "Yes." At PN533, I went on to ask him: "So you then accept that to a significant extent, the operations of the state business are administered at the state level?" He responded again, "Yes", with regards to the targets.

PN403

PN530, the witness explained that branch managers are responsible for ensuring that a branch is meeting its targets and that a state manager is responsible for ensuring that the state is meeting its targets. Finally, at PN520 through to 525, the witness told the Commission that on a daily basis, branch managers are given a pulse report that advises them how their branch is tracking in relation to various targets and how their state is tracking in relation to various targets. So they get those two reports and they assess how things are going.

PN404

The evidence to which I have just run through supports a finding that there is a degree of organisational distinctness between the group of employees.

PN405

THE DEPUTY PRESIDENT: But it feeds up. It feeds up to national level, doesn't it?

PN406

MR BAKRI: Yes, yes, and, in my submission, that - - -

PN407

THE DEPUTY PRESIDENT: Just as the branches feed up to the state level.

PN408

MR BAKRI: That is correct. That is correct and, in my submission, I am not saying that the branch or the state-based business is distinct in an absolute sense. It is not open on the evidence. As you say, and I think my learned friend referred to it as a pyramid, it feeds up. So we can see that there is necessarily a level of integration nationally as there would be, one would think, in most businesses that operate nationally. Notwithstanding that, on the evidence, in my submission, there is also a significant degree of management that is conducted at the local level in the branch and then at the state level as well.

PN409

THE DEPUTY PRESIDENT: But, ultimately, it just doesn't end there, does it?

PN410

MR BAKRI: It doesn't.

PN411

THE DEPUTY PRESIDENT: It goes up and if there was something going wrong at branch level, it would have to be addressed at state level and if it wasn't addressed at state level, it would come up at a national level.

PN412

MR BAKRI: Yes, and the evidence was that the branch manager is responsible for managing the branch employees. The state manager is responsible for managing state employees. And, as far as I recall, there was no evidence as to which national managers would be responsible for issues that were escalated. But we don't contend that the branch and state level management are not accountable to above. What we say is that organisationally there is a degree of distinctness both at the branch level and at the state level and to only focus in on the national level of management is not fairly characterising the evidence that was given.

PN413

THE DEPUTY PRESIDENT: It feels to me that your strongest point is geography.

PN414

MR BAKRI: Yes, I would accept that. I would submit that not only is that the strongest point, that it is not open to find any other way, that there is geographic distinctness.

PN415

THE DEPUTY PRESIDENT: On geography, yes.

PN416

MR BAKRI: If I could rank the other points, in my submission, there is a distinctness in an organisational sense and an operational sense and I want to move also onto the question of arbitrariness. But I accept what you say, Deputy President, that our strongest point is geography because it is unimpeachable, in my submission.

PN417

Just to finish off this point, the evidence in its totality indicates that the respondent has chosen to organise its business into branches and states that form part of the overall national business and it flows from this that there is a degree of organisational distinctness and that is the finding that is open. It is not an absolute distinctness. It doesn't operate as an island in the state of Victoria. It is still part of a broader business, but organisational distinctness is all about how the employer has chosen to organise its business and it has organised it on branch and state lines as well as national lines.

PN418

The respondent refers to the shared services employees that provide training, HR and other services. In my submission, very little weight can be put on this evidence and it should not derogate from the finding that the group is organisationally distinct. Again, I refer to the decision of Roe C at paragraph 28.

PN419

THE DEPUTY PRESIDENT: But why? Why?

PN420

MR BAKRI: In my submission, the fact that there is a degree of organisational integration in relation to those sorts of matters, IT, planning, training and OH&S, is - - -

PN421

THE DEPUTY PRESIDENT: But there is HR. There is HR.

PN422

MR BAKRI: Yes, and HR, and I think that there are more than that. It is very common and it is not a feature that indicates that there is not organisationally distinctness at a state level. It is very common in businesses for efficiency reasons for those sorts of services to be provided on a national level. That does not mean that the group won't be fairly chosen if it is state based.

PN423

THE DEPUTY PRESIDENT: But again, you know, you can't diminish one and amplify another, really. When you are a nationally integrated business or a national organisation and you have got shared services, you have also got KPIs, you have got ways of working, you have got things that the state branches cannot step out of the tramlines on because that is the way in which the employer has set up its business.

PN424

MR BAKRI: Yes, but the question here is, is a group that is limited to Victoria fairly chosen or not? And just because there is some management conducted at a national level does not indicate that that group is not fairly chosen. I am repeating myself, but it may be that a national - - -

PN425

THE DEPUTY PRESIDENT: Why would you have a national business then? Why wouldn't you just say: "Well, look, we will just hive off and run as a separate entity?"

PN426

MR BAKRI: I don't understand the question.

PN427

THE DEPUTY PRESIDENT: The organisation in this case which is predominantly based in Queensland sets up in other states and runs according to principals and reports back in and operates with shared services located around the place, but generally in Queensland. This is not like they have just hung a shingle on the door and said: "We are in Victoria, off you go and run a legal practice." It all references back to the national structure.

PN428

MR BAKRI: Yes, and you may have the view, Deputy President, that it would be preferable for there to be a national agreement, but that is not - - -

PN429

THE DEPUTY PRESIDENT: I am not saying that. I am just trying to get to the heart of these questions around operational and organisationally distinct.

PN430

MR BAKRI: Yes, and, in our submission, we don't say that there is distinctness aside from geography - we will put that to one side - in an absolute sense. We say it is a matter of degree and on one side of the ledger we have got some things that assist us. On the other side, there are some things that assist them. We say there is absolute distinctness in the geographical sense, a degree of distinctness in an operational and organisational sense, and looking at that altogether in assessing the other factors in the provision, the group is fairly chosen.

PN431

THE DEPUTY PRESIDENT: The way I understand the Full Bench in the appeal from Roe C's decision was that it is a brief decision that largely goes to whether he conducted the task before him and had regard to the things, but essentially he is exercising a discretion. Do you say that that Full Bench decision enshrines certain principles that follow or that he approached the task that was required of him in an orthodox manner?

PN432

MR BAKRI: In my submission, the Full Bench endorsed the approach that he took in that it found that it was not - - -

PN433

THE DEPUTY PRESIDENT: It was not attended with error.

PN434

MR BAKRI: It was not attended with error. If I could briefly say something about the submissions made in support of a Jones v Dunkel inference being drawn. There is very little evidence that is in conflict. As you would have seen in our outline of closing submissions and the submissions I have made today, we largely rely on the evidence of Mr Chrara who gave evidence that we say supports the requisite level of distinctness. A Jones v Dunkel inference can only be drawn where there is a conflict in the evidence on particular issues and there is an unexplained failure by a witness to call someone that could have been called to explain that conflict.

PN435

The circumstances don't arise for an inference to be drawn. Furthermore, a Jones v Dunkel inference can't be drawn on a global level. My learned friend has not articulated with any specificity at all what inferences he seeks to be drawn, so there is no licence for such an inference to be drawn, in my submission.

PN436

The final thing that I want to address, my learned friend took you to the John Holland decision.

PN437

THE DEPUTY PRESIDENT: Yes.

PN438

MR BAKRI: I just want to be clear, I don't know if I made this point clearly, that in my submission it does not displace the reasoning in Kwinana. So we rely on John Holland in a different way, but we say that Kwinana contains principles that should be followed as a Full Bench decision that stands. That approach was followed in the Alcoa Full Bench, and the John Holland decision does not change that situation. Those are the submissions, unless there is anything else I can assist you with.

PN439

THE DEPUTY PRESIDENT: Thank you. Do you have any final comment about the way in which Mr Harrington characterises the propositions put about only having the evidence of Mr Lewis? Do you challenge what he said on that today, that it was assertion from the Bar table and the Briginshaw standard and that?

PN440

MR BAKRI: As to why? Reasons for not calling?

PN441

THE DEPUTY PRESIDENT: Yes.

PN442

MR BAKRI: I accept that there is no evidence about that.

PN443

THE DEPUTY PRESIDENT: Yes, all right.

PN444

MR BAKRI: And you can't make anything of assertions from the Bar table.

PN445

THE DEPUTY PRESIDENT: Thank you. All right, thank you. I thank the parties for their assistance today and for the preparation of their materials and I will reserve my decision and hand it down in due course. And safe travels, Mr Harrington.

PN446

MR HARRINGTON: Thank you.

ADJOURNED INDEFINITELY [4.10 PM]

Fair Work Commission Transcripts

B2016/1334, Transcript of Proceedings [2017] FWCTrans 270 (26 June 2017)